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Generic cancer drug – access not guaranteed

A generic version of a key cancer drug is now available in South Africa, but at a significantly higher cost than it is available internationally.

Imatinib is used primarily for treatment of chronic myelogenous leukemia, or CML, and gastrointestinal stromal tumours, or GIST. The government of India won a landmark case earlier this year against the drug’s inventor, Novartis, by rejecting the company’s patent on a crystallised form of the drug, allowing generics to stay on the market. According to Médecins Sans Frontières, generic versions of the drug are available in India for as little as R10 694 per year.

But unlike India, South Africa has granted several patents to Novartis on Imatinib, and, until recently, Novartis was the only company supplying the product in the country, under the name Gleevec. Here, patients pay R387 830.75 per year.  

But in April, Novartis’s Imatinib patent expired, and the generic company Cipla now has a version on the market. Branded Imavec, it is priced at R208 944.25 per year. Novartis is also now selling their own lower-cost version of the drug. Called Vativio, it sells for R214 112.65 a year. 

While the new versions offer a significant price drop, Médecins Sans Frontières and the Treatment Action Campaign say that Cipla is selling its product on the South African market at a price 11 times higher than what it sells in India, and 20 times higher than the cheapest generic product available. They also say that Novartis’s price is nearly two times higher here when compared to what it sells in India. 

Cipla refused to give comment on its South African price, claiming that it was commercially sensitive information. Anthea Seafield, spokesperson for Novartis, says the company currently supplies the drug free of charge to South Africa’s public sector patients through its International Patient Assistance Programme. She says two-thirds of South Africa’s patients accessed the drug this way, while the other one-third access it through medical schemes. Seafield also notes that Vativio is priced 45% cheaper than Gleevec, in line with a generic.

Access not guaranteed

But Dr Anban Pillay, deputy director in the health department, says that Novartis told the department it would no longer provide the medicine for free to public sector patients now that a generic is on the market. Access through medical schemes also isn’t guaranteed: in February of last year, the Council for Medical Schemes Appeals Committee decided that schemes didn’t have to pay for medicines used to treat conditions listed as prescribed minimum benefits if the treatments were excessively expensive. As such, Gleevec is not considered cost effective, and medical schemes therefore do not have to fund its use in treatment of CLM or GIST.  

But Pillay is optimistic that affordable versions of the drug will make their way into the public sector. He says the department will consider the number of patients in need of Imatinib in the public sector, and expects a “positive response” and lower price from companies before procuring the drug. 

Pillay concedes that drugs are sometimes more expensive in South Africa than India, a price difference attributes to relatively lax standards set by India’s regulatory authority when compared with South Africa’s Medicines Control Council. “Many Indian manufacturers supply into the African market, but they’re not the same products that we could sell to South Africa,” he says. “This is largely because most African countries don’t have the quality requirements we do.” Pillay says Indian companies make different versions of the same product depending on the markets they sell to, sometimes using lower quality ingredients if they know they won’t their drugs won’t be tested as thoroughly. He says it’s unclear how the difference in quality and regulation impact treatment outcomes.

While the department uses reference pricing and tenders to procure medicine for the public sector, it does not negotiate prices on behalf of medical schemes, and prices in South Africa are higher. The department does, however, set Single Exit Prices that drug companies must meet in order to sell to the private sector. These prices are comparable to those in Australia, New Zealand, Spain and Canada, which Pillay says are countries with strong regulatory agencies and policies to keep prices affordable. Under the national health insurance, Pillay says the department will procure for a formulary that both the private and the public sector can access, which he hopes will bring prices down while also equalising access. 

Inequality in SA skews data 

But Suerie Moon, co-director of the project on innovation and access to technologies for sustainable development at Harvard University, says that reference pricing and international benchmarking aren’t necessarily the best way to get the most affordable price, especially for a country like South Africa. “One of the products of inequality is that the average per capita GDP is quite high, but of course the income of a particular population is below that,” says Moon. “By using per capita GDP, South Africa would probably be compared with countries where a large majority of the population is actually better off.” 

Moon also says that price of cancer drugs is “the next battle in access to medicines.” She says that prices of cancer drugs in particular are “all over the map” and “illogically high”. 

“There is a lot of uncertainty … about the ability to provide cancer treatment and care,” says Moon. “We see a lot of the same arguments [for cancer] as we did with HIV, like why bother with the drugs if you don’t have the infrastructure in a country? But we know from experience with HIV that it’s possible to build up that infrastructure and that it’s possible to look for new ways to tackle difficult questions about how you provide acceptable quality of care in developing countries.”

Moon suggests that innovative mechanisms, like patent buy outs, could help to lower drug prices. This would allow governments to pay a lump sum to a company, and in exchange receive the right to manufacture an otherwise patent-protected drug. Moon also says South Africa should consider compulsory licensing, in which governments can force companies to give up their patent rights. “At the end of the day, the government of South Africa should be ready and willing to use compulsory licensing if patent holders are not willing to negotiate,” she says. “It’s their right under international trade laws, they should make full use of it.”

The Indian price of Imatinib is the final cost to customer, including tax. The South African Imatinib prices are Single Exit Prices listed in South Africa’s Medicine Price Registry, and therefore include a logistics fee and VAT.

Mara Kardas-Nelson was an OSF fellow at the Bhekisisa Centre for Health Journalism.